Information for Hobson Corporation for the current year ($ in millions): Income from continuing operations before tax Loss on discontinued operation (pretax) Temporary differences (all related to operating income): Accrued warranty expense in excess of expense included in operating income Depreciation deducted on tax return in excess of depreciation expense Permanent differences (all related to operating income): Nondeductible portion of entertainment expense The applicable enacted tax rate for all periods is 25% What should Hobson report as income from continuing operations? $ 230 10 85 175 20

Information for Hobson Corporation for the current year ($ in millions): Income from continuing operations before tax Loss on discontinued operation (pretax) Temporary differences (all related to operating income): Accrued warranty expense in excess of expense included in operating income Depreciation deducted on tax return in excess of depreciation expense Permanent differences (all related to operating income): Nondeductible portion of entertainment expense The applicable enacted tax rate for all periods is 25% What should Hobson report as income from continuing operations? $ 230 10 85 175 20

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Calculating Deferred Tax Balance Evergreen Company's reconciliation between pretax GAAP income and taxable income follows for the year. Pretax GAAP income $240,000 Depreciation adjustment (48,000) Permanent difference 1,500 Taxable income $193,500 The company had one temporary difference due to the GAAP basis of equipment exceeding the tax basis of equipment. Record the income tax journal entry for the year, assuming a tax rate of 25%. Assume that the January 1 deferred tax liability balance was $6,000. • Note: Round amounts to the nearest whole dollar. Account Name Date Dec. 31 Income Tax Expense Deferred Tax Liability Income Tax Payable To record income tax expense. Dr. 0 0 0 Cr. 0x 11,625 x 48,375
Mami Co. computed a pre-tax financial income of 15,000,000 for the year ended Dec. 31, 201X. In preparing the tax return, the following differences are noted between financial income and taxable income. Non-deductible Expense 2,000,000 Non-taxable revenue 1,000,000 Estimated warranty cost that was recognized as expense in 200X but deductible for tax purposes when paid 1,500,000 Excess tax depreciation over financial depreciation 500,000 What is the current tax expense for 201X if the tax rate is 32%?
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*see attached problem REQUIRED: What is the total income tax expense for the current year?
nformation for Hobson Corporation for the current year ($ in millions): Income from continuing operations before tax $ 155 Loss on discontinued operation (pretax) 32 Temporary differences (all related to operating income): Accrued warranty expense in excess of expense included in operating income 10 Depreciation deducted on tax return in excess of depreciation expense 25 Permanent differences (all related to operating income): Nondeductible portion of entertainment expense 5 The applicable enacted tax rate for all periods is 25%. What should Hobson report as income from continuing operations?
1. ACE Company had pretax GAAP income of $50,000 for the tax year ended December 31. Label each of the following items as either Deferred Tax Liabilities (DTL) or Deferred Tax Assets (DTA) 1. Excess accelerated depreciation for tax purposes, $5,000 2. Unrealized holding gain on securities accounted for under FV-NI, $2,000 3. Unrealized holding loss on securities accounted for under FV-NI, $2,000 4. Rental receipts received in advance, $30,000 5. Litigation contingency accrual, $10,000 6. Six-month prepaid rent deposit, $12,000 40.000 5 2.80
Information for Hobson Corp. for the current year ($ in millions): Income from continuing operations before tax $ 160 Loss on discontinued operation (pretax) 20 Temporary differences (all related to operating income): Accrued warranty expense in excess of expenseincluded in operating income 20 Depreciation deducted on tax return in excess ofdepreciation expense 25 Permanent differences (all related to operating income): Nondeductible portion of entertainment expense 10 The applicable enacted tax rate for all periods is 40%. How much tax expense on income from continuing operations would be reported in Hobson's income statement? multiple choice: a. 66 million b. 64 million c. 68 million d. 44 million I have tried several different ways but none of them come up with answers close to any of the ones to choose from.
Item 4 During 2021, its first year of operations, Baginski Steel Corporation reported a net operating loss of $408,000 for financial reporting and tax purposes. The enacted tax rate is 25%. Required:1. Prepare the journal entry to recognize the income tax benefit of the net operating loss. Assume the weight of available evidence suggests that future taxable income will be sufficient to benefit from future deductible amounts arising from the net operating loss carryforward.2. Show the lower portion of the 2021 income statement that reports the income tax benefit of the net operating loss.
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 280,000 Permanent difference (15,600 ) 264,400 Temporary difference-depreciation (20,900 ) Taxable income $ 243,500 Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as its deferred income tax liability as of the end of its first year of operations?
Information relating to Waukegan Company for the current year is as follows: Income from continuing operations before tax $ 140,000 Income from discontinued operations (pretax) 40,000 What is the amount of the income tax expense that should be allocated to the income from discontinued operations? (Assume the effective tax rate is 25%) income tax expense
An entity reported the following information during the first year of operations: Pretax financial income 9,000,000 Nontaxable interest received 1,000,000 Long-term loss accrual in excess of deductible amount 1,500,000 Tax depreciation in excess of financial depreciation 2,000,000 Income tax rate 30% What is the deferred tax liability at year-end?
Umasa Corporation reported the following information for the current year: Pretax financial income Income from exempt municipal bonds Rent received in advance P 9,000,000.00 2,000,000.00 1,500,000.00 Depreciation deduction for income tax purposes in excess of depreciation reported for financial reporting purposes Estimated tax payment for current year Income tax rate 1,000,000.00 500,000.00 30% 21. What amount of current tax liability should be reported at the year-end? B. P2,250,000 A. P1,750,000 C. P2,750,000 D. P2,850,000 22. What is the total tax expense? A. P2,700,000 B. P2,100,000 C. P2,250,000 D. P1,600,000